Amazon lost millions of dollars on huge sales! Reselling at low prices is a rip-off

While Amazon provides development opportunities for sellers, its supervision is becoming increasingly strict. However, some people still try to gain benefits by using the platform as a channel to make quick money, which harms the interests of many parties. At the same time, affected by multiple factors, some small and medium-sized sellers have recently encountered some difficulties.

Amazon loses millions of dollars as products are resold at low prices

Recently, Spangler Candy, a popular brand on Amazon, found that its products were sold at low prices by some people through other channels, and the products sold were worth millions of dollars. The brand's main product is candy.

In order to verify whether the product was genuine, the person in charge placed an order from a third party claiming to be an Amazon seller for verification. After receiving the goods, he found that the product was not a fake product. However, what he did not expect was that the product was shipped from a Walmart membership store.

After investigation, the person in charge found that these so-called Amazon sellers did not directly touch the products, nor did they obtain the sales authorization of the brand. Instead, they found the same products on the Amazon platform but at a lower price through information transmitted on some social platforms, and then sold them on the platform in the name of Amazon sellers, but the actual shipping party was another platform. The actual price of 400 packs of goods that originally cost $26 was about $10, and the huge price difference between the two sellers made them a lot of profit.

It is understood that the brand's losses have reached millions of dollars. These "fake" sellers also sold multiple categories of goods, including food and daily necessities, through this resale model.

As sellers know, this dropshipping resale model is actually not allowed by Amazon. Amazon has made a statement on similar incidents: sellers are prohibited from shipping products from other retailers to customers.

According to Amazon's regulations, such violations will usually result in the suspension of sales privileges within a week if reported. The person in charge of the brand said that he had considered complaining to Amazon, but as the number of sellers selling the brand's products on the Amazon platform has increased dramatically, it has become extremely difficult to track these sellers, and the complaint may not have any effect. However, the brand said that they will file a lawsuit against unauthorized dealers and unrelated shippers.

Public information shows that SpanglerCandy is a long-established company headquartered in Ohio, USA. It was founded in 1906 and has a daily output of 2.7 million. SpanglerCandy's products have always been ranked at the top on Amazon, and enjoy a high reputation in the local market and are very popular among consumers.

This incident also caused heated discussions among many sellers.

Some sellers said: "Although these people have gained short-term benefits, they have caused long-term and substantial damage to the brand. Now they are selling candy, will it extend to various products on the Amazon platform in the future? " Other sellers believe: "Amazon should conduct another thorough inspection and rectification of this group of sellers, and should not let it go, which is causing sellers like this brand to lose the right to actively sell. "

In fact, in addition to the illegitimate profits from such resale, some criminals also use Amazon to blackmail and conspire with relevant personnel to steal seller information. Many similar incidents have occurred this year: sellers have received emails claiming to be Amazon officials asking for thousands of dollars, seller account information has been stolen, buyers frequently return products and threaten malicious negative reviews ... These incidents continue despite repeated bans, and the supervision of cross-border e-commerce platforms is waiting for the system to be improved and mature.

When veteran sellers like SpanglerCandy also encounter difficulties, it goes without saying that small and medium-sized sellers on the platform face even more problems.

Sellers face another problem: a sudden increase in negative reviews and container congestion

After Member Day, many sellers found that they could not replenish their inventory, and there were delays in cargo transportation and a sudden increase in negative reviews from buyers in the backend.

Some sellers reported that there might be a problem with Amazon's backend. After the membership day, the buyer satisfaction status of some of their products turned red (very poor) and then recovered. But some sellers were not so lucky. They said that all their products turned from green to red and lasted for many days. The seller said that he originally thought it was a system problem, but this situation lasted for so many days, and the product sales would be affected to a certain extent. He was speechless.

However, some sellers have different opinions. They believe: "In addition to the possibility of system problems, the sellers themselves may have improper operations. After all, it is not overnight that the red status will appear. The number of orders and product quality will have a substantial impact on buyer satisfaction. It is better to find the problem from yourself first. If it is not your own fault, you should find relevant personnel to solve the problem this morning."

While sellers are troubled by negative reviews, some sellers are more worried about their logistics inventory being stranded in non-fulfillment centers for anywhere from half a year to a year. According to one seller, the inventory of one of his ASINs has been in a non-fulfillment warehouse for nearly half a year.

When the seller first learned that the inventory was transferred to the non-fulfillment warehouse, the response he received was that the inventory would arrive at the destination in about 30 days. During this period, the seller's product did change to an active status, but then returned to its original status. When the seller asked about this again, the response was the same as before. Currently, the seller said that he has not replenished the inventory of this ASIN and is worried that other inventory will become the same.

For sellers who are restocking, the recent increase in delays in goods transportation is particularly distressing. Such problems that occur in the future of membership have a significant impact on the sales performance and transportation costs of the relevant sellers. Many sellers believe: "If this phenomenon increases, the number of returns will also increase, and the losses will increase. It is a bit frustrating, but it is also helpless."

Similar incidents have occurred many times, making sellers feel helpless and accustomed to them. But on the other hand, such incidents test the risk resistance of sellers of all sizes to a certain extent. At the moment when the cross-border e-commerce industry is returning to a stable state, small and medium-sized sellers will inevitably bear greater risks than big sellers. When dealing with risks, they are slightly disadvantaged in terms of funds, manpower, and later response measures.